Cignal Cable Corporation (Cignal Cable) on Wednesday, Aug. 11, entered into a Sale and Purchase Agreement with Sky Vision Corporation (Sky Vision), ABS-CBN Corporation (ABS-CBN), and Lopez, Inc. to acquire 38.88 percent of the total issued and outstanding capital stock of Sky Cable Corporation (Sky Cable) for P2.862 billion.
The investment of Sky Cable by Cignal Cable is expected to benefit the former’s existing customer base consisting of over 300 thousand cable subscribers and close to 350 thousand broadband subscribers as of the end of June 2022.
**media**
Cignal Cable believes its entry into Sky Cable will strengthen and enhance its public services offerings, allowing Sky Cable to expand its coverage.
Currently Sky Cable is operating Knowledge Channel, which provide educational programs for children, and DepEd Channel, which offered Long-Distance Learning to the Filipino youth during the pandemic in cooperation with the Department of Education and Culture.
Cignal Cable plans to expand the public services programs that will be offered by Sky Cable to assist the Government in providing public services to the Filipinos, particularly in remote areas.
Simultaneously with the execution of the Sale and Purchase Agreement, the parties executed a Debt Instruments Agreement, whereby Sky Vision Corporation agreed to issue an Exchangeable Debt Instrument to Cignal Cable with a face value of P4.388Billion.
The Debt Instrument gives Cignal Cable the option to acquire additional Sky Cable shares equivalent to 61.12 percent of the outstanding capital stock of Sky Cable after 8 years from its issuance, subject to obtaining regulatory approvals.
Under the Debt Instruments Agreement, Cignal Cable will also acquire a Convertible Note issued by Sky Cable with a face value of P250 Million and convertible into primary shares of Sky Cable representing about 1.84 percent of outstanding capital stock.
The proceeds of the sale of the Sale Shares, the Convertible Note and the issuance of the Debt Instrument in the total amount of P7.5Billion will be used to repay certain obligations of ABS-CBN and Sky Vision and to fund the investment of ABS-CBN in TV5.
ePLDT, a subsidiary of PLDT, Inc., will fund, through a loan extended to Cignal Cable, the P7.5 Billion acquisition cost of Cignal Cable of the Sale Shares and the foregoing debt instruments.
Financial closing, which is expected within the month of August 2022, shall be subject to compliance with certain closing conditions which include, full payment of the purchase price for the common shares, subscription to the Debt Instrument, and purchase of the Convertible Note.
AlphaPrimus Advisors and Picazo Buyco Tan Fider & Santos advised the MediaQuest group on this transaction while the law firms of Romulo Mabanta and Quiason Makalintal advised ABS-CBN.